LOUISVILLE, Ky.--(BUSINESS WIRE)--Pinnacle Surety, a professional surety bond agency, recently filed an amended
complaint to its legal malpractice lawsuit against Manion Stigger
LLP and Cooper & Elliott LLC in U.S. District Court. In the lawsuit,
Pinnacle states that the law firms secretly assisted two employees
against Pinnacle while the bond firm was still represented by the same
attorneys. The lawsuit seeks damages against the law firms, and
attorneys G. Bruce Stigger and Rex H. Elliott, for fraudulent
concealment, breaches of fiduciary duties, legal malpractice/negligence,
intentional interference with an employment agreement, and civil
conspiracy among other claims.

In 2013, Pinnacle hired Manion Stigger and Cooper & Elliott to represent
the company in a civil lawsuit brought by a third party regarding the
employment of Todd Loehnert and Brian Ayres, who had been hired to open
a Pinnacle office in Louisville. That case was resolved with the third
party, Loehnert and Ayres continued working for Pinnacle, and the
attorneys were paid for their representation of Pinnacle.

According to the amended lawsuit, while still representing Pinnacle,
attorneys Stigger and Elliott began also counseling Loehnert and Ayres
against Pinnacle, as the pair started a competing surety bond company
with the intention of breaching their employment agreements with
Pinnacle. Stigger even assisted in creating the new entity and served as
its registered agent, according to the complaint.

The lawsuit further states that “all of these adverse actions against
Pinnacle occurred without disclosure to Pinnacle by Defendants, while
Defendants represented Pinnacle’s legal interests and owed it the
highest fiduciary duties…”

Though Stigger and Elliott have denied a conflict of interest, the
lawsuit states that a federal judge ruled in 2014 that an
attorney-client relationship existed between Pinnacle and Stigger and
Elliott; and that the “Defendants were directly and materially adverse
to Pinnacle.” Both law firms were later disqualified from representing
Loehnert and Ayres.

The lawsuit seeks damages for lost business, profits and opportunities;
damage to Pinnacle’s reputation; and punitive damages among other costs.